Ukraine wants better gas deal from Russia

GMT
20:43 2011
Friday ,02
September

Kiev - Qna

Ukrainian Prime Minister Nikolay Azarovsaid said on Friday he will have to negotiate a new gas deal with Russia because of previously-undisclosed plans to break up the republic''s existing energy company. Ukrainian Prime Minister said in a statement that the 2009 contract, signed by his predecessor Yulia Tymoshenko, contradicts a 2004 intergovernmental agreement between Moscow and Kiev and thus must be revised. Ukrainian President Viktor Yanukovych later said on his website that the restructuring was being conducted in line with EU demands for better sector transparency and should be presented for formal approval by October 1. The news broke one day ahead of a regional summit in the Tajik capital Dushanbe that is due to be attended by both Yanukovych and his Russian counterpart Dmitry Medvedev. Russia has been steadily raising the price it charges former Soviet republics for gas after spending years subsidising shipments and ensuring friendly diplomatic relations in return. Ukraine argues that it now pays more than some richer EU member states and that Russia''s price terms are political. Medvedev admits that he would lower Ukraine''s gas price if it dropped plans to establish free trade relations with the European Union and allowed Gazprom to win control of half of Naftogaz.